HR career development

Introduction

Workforce performance management (WPM) systems enable organizations to automate

and optimize their performance processes and align employee development and goals
with corporate objectives. Organizations that have invested in WPM systems cite a
number of significant benefits, including: Establishing clear performance expectations for
the workforce Standardizing performance processes and practices across the entire
organization Aligning employee goals with the strategies and objectives of the
organization Facilitating communication of goals, strategies, and core values Ensuring
that goals are consistently being met in an effective and efficient manner Establishing
clearly defined and dynamic career development plans - which can be linked to learning
and training - leveraging competencies Supporting pay-for-performance initiatives (when
linked with compensation) Enabling objective, company-wide workforce measurement,
reporting, and analysis, including regulatory compliance reporting and auditing Here are
five critical steps to ensure that you get the most out of your WPM investments.

Tip #1: Calibrate Performance Ratings Across The Organization

Ratings Distribution Management (RDM), also called ratings calibration, provides the
ability to calibrate ratings to ensure that the dissemination of performance scores is more
consistent across an organization. In a typical diverse, global organization, performance
rating scales differ from division to division. RDM ensures that employees are rated
consistently and fairly across the entire organization, and as a result, incentives and
rewards can be applied more appropriately. RDM also eliminates the age-old problem of
managers rating all of their direct employees as 4s or 5s on a five-point scale (often to get
a bigger chunk of the bonus pool). It "forces" managers to make oftentimes difficult
decisions about the performance of their directs. The resulting ratings calibration
typically resembles a bell curve (e.g., few 1s & 2s, many 3s, few 4s & 5s). Key questions
to consider when deploying RDM are:

1. Are the WPM system and associated RDM functionality flexible enough to
support different ratings scales and models? For example, different divisions or
geographies may have unique ways of managing their performance processes.
2. Does the WPM system mandate the use of RDM functionality? Ideally, the
functionally should be optionally enabled with a simple configuration switch,
since the concept of ratings calibration is controversial to some organizations.

Tip #2: Link Performance Processes to Career Development And Learning

Management
While the output of the WPM process is a finalized performance review between a
manager and his/her direct report, the process also identifies employee skill, competency,
and behavior gaps. Along with other forms of self-assessment, as well as 360 feedback (if
used within the organization), a clear picture of employee gaps emerge. With this picture
in hand, employees are better able to build career development plans that focus on
improvement in their current role, better prepare them for a future role of interest, or
both. The importance of career development cannot be underestimated. According to a
December 2008 survey of global HR leaders conducted by Softscape, fully 97% of HR
leaders believe that a systematic career development process positively impacts employee
retention and engagement. HR leaders also believe that providing career advancement
opportunities as well as dedicated career development planning to employees are the two
most important mechanisms for retaining high performers. The final step in the career
development planning process is to select educational and training activities as
developmental goals in the WPM system to improve skills, competencies, and behaviors.
Indeed, many organizations are moving closer to linking career development and learning
management. In fact, nearly two-thirds of organizations have tied or plan to tie employee
career development planning to learning management in order to facilitate training and
course work. A few key questions to consider when linking these various talent
management functions are:

1. Can an employee create a new development plan directly within the performance
review process, or, jump directly into his/her existing plan to amend it?
2. Does the career development process stand on its own as a separate process to
enable off-performance review cycle planning?
3. Is the transition between WPM, career development, and learning management
processes seamless to users (e.g., same user interface, look and feel, does not give
the user the impression of a disconnected process)?
4. Is systems integration effort and cost required to tie all these talent functions
together, or do the functions all reside on a common technology platform that
natively connects them out of the box?
5. Can you easily run cross-functional reports to identify the impact of career
development and learning on employee performance?

Tip #3: Enable Pay-For-Performance To Build A Merit-Based Culture

Programs that align employees' compensation - merit increases, bonuses, long-term

incentives - to their performance have proven to be very effective in driving actual
performance. Often called pay-for-performance (P4P), the concept is to build a culture of
top performers by aligning goals, performance, and rewards across an entire organization.
Motivating, rewarding, and retaining top performers is a key business objective for any
company that seeks to successfully maintain or exceed growth expectations. Best-in-class
organizations focus on a performance-driven rewards system that compensates individual
contributors directly proportionate to what they achieve and what they contribute to the
bottom-line. The challenge lies in effectively aligning employee goals with
organizational objectives, automating WPM processes, and linking them with complex
compensation policies or time-based incentive plans at an enterprise level. P4P and merit-
based pay programs - especially those that relate to executives - have received renewed
interest lately due to emerging legislative and regulatory compliance pressures stemming
from the global financial system crisis. Yet only 36% of organizations have made
significant technology investments to automate and improve P4P processes. Clearly,
there is an opportunity to both espouse the virtues of a merit-based culture while at the
same time working toward becoming compliant as new regulations are put into effect.
The latter issue will be particularly important for publically-traded companies. Ideally, a
single, centralized HR platform that natively connects all of the required components for
P4P is required because it facilitates cross-functional reporting and eliminates the
technical challenge and cost of integrating and managing disparate systems. The required
pre-integrated components for P4P are:

1. Workforce Performance Management: Automates and optimizes performance

processes and aligns employee development and goals with corporate objectives.
WPM enables organizations to plan employee efforts in support of organizational
goals and strategic initiatives, and to evaluate outcomes, performance, and core
competencies.
2. Compensation Planning: Simplifies planning, modeling, budgeting, and analysis
of compensation policies. Compensation Planning enables organizations to
develop and apply consistent compensation plans to all employees.
3. Incentive Compensation: Motivates employees and manages financial rewards
within an organization. Incentive Compensation streamlines incentive policy
administration and provides long-term planning for both market- and
performance-based plans, as well as variable pay flexibility for individuals, teams,
sales, or executives.
4. Reporting and Auditing: Provides accessible and secure cross-functional
compliance reports and audit trails of all transactions related to compensation and
performance. Reporting and Auditing aggregates key information to facilitate
timely decision making.

Tip #4: Drive Continuous Improvement By Leveraging Workforce Analytics

Traditional transactional reporting and spreadsheet-based tools have been available to HR

for many years. Often inflexible, difficult to use, and inaccessible, these tools
nevertheless are what HR professionals currently rely on for critical workforce metrics
(e.g., employee retention, time-to-hire). But they can hardly be classified as strategic.
And given the global economic conditions, HR leaders are under increasing pressure to
consistently measure and communicate the impact of their HR programs, especially to
secure funding for strategic initiatives. Unfortunately, transactional reporting tools
provide little help. Strategic workforce analytics, on the other hand, provide more
meaningful methods for measuring HR efficiency and effectiveness. New, pre-integrated
technologies have emerged that enable HR professionals to focus more on analysis,
insight, and action rather than on data collection and manipulation. For example, what
HR leader would not like to know the true impact of learning and training programs on
employee performance, or the effect of employee engagement programs on workforce
productivity? Part of the challenge facing HR leaders is the fact that data is spread out in
various silos across the organization and there is no common employee system of record.
A single, fully-connected HR platform that covers the gamut of talent functions including
WPM can alleviate some of the problems, since the data is all in one place. And with a
robust analytic and reporting function, along with pre-defined metrics, previously
unavailable insight can be gained. A few key questions to consider when evaluating
approaches to workforce analytics are:

1. Does the WPM system leverage a robust and industry standard analytics engine
which provides interactive graphical displays of all data?
2. Does the WPM system abstract the complexity out of the analytics engine so that
non-technical users can conduct their own analyses via an intuitive, web-based
interface?
3. Is there an ability to compare and relate deep analytical views beyond the WPM
system - in other words, across the entire talent management platform - to glean
insight into more strategic HR metrics such as the impact of training on employee
performance?
4. Does the analytics system reduce administrative overhead by leveraging the same
comprehensive security access rights and rules as the WPM system so that
security policies only have to be established once?

Tip #5: Configure, Don't Customize

The elements of a WPM system must be fully configurable to suit each organization's
unique needs. The sections of a performance management form, such as goals,
competencies, and development activities, as well as the number of steps in the process
(i.e., workflow), must be selectable by the organization, division, or even geography.
Configuration includes which actions can be performed at each step of the process,
security controls over who can read or edit the form, and the text of automatic e-mail
notification messages. It is important to delineate between configuration and
customization because different platforms and technologies tend to favor one approach
over the other.

• Customization: Making programmatic changes to an application. Customization

is a development-centric exercise that extends an application beyond what it was
designed to do. Custom code can be useful but also dangerous since it has
implications on future upgrades and tends to increase total cost of ownership.
• Configuration: Making declarative changes to an application. Configuration
entails changing system parameters to affect application change. Configuration is
often preferable to customization since it does not jeopardize future upgrades.
Advancements in technology have made a pure configuration approach the
preferred option for most organizations. Configuration is achieved through
parameter-based utilities and wizards that do not require technical programming
expertise, thereby providing customers with flexibility and complete control to
configure every aspect of the WPM system, including menus, forms, workflows,
look-and-feel, and security. The benefits include lower total cost of ownership as
 well as more seamless future upgrades. A few key questions to consider
pertaining to configuration are:

1. Can non-technical users such as HR administrators leverage configuration tools

that do not require technical programming skills or IS/IT involvement?
2. Do the configuration tools enhance the overall flexibility of the WPM system by
providing very granular configuration options, including changes to menus,
forms, workflows, look-and-feel, and security?
3. Do the tools enable rapid deployment of customer-specific requirements and the
flexibility to make changes on-the-fly? For example, how easy is it to create a
new performance process or adapt an existing one for use in a new division or
geography?
4. Are configurations preserved between WPM system upgrades, thereby reducing
the time, effort, and cost of upgrading to new versions?

Conclusion

Your organization has decided to technology-enable your workforce performance

management processes, but your journey is just beginning. New business drivers may
lead you in one direction, while regulatory compliance issues may mandate another
direction. Getting the most out of your investments will take patience and perseverance.
The key is to remain flexible and open to the numerous possibilities and benefits that a
systematic WPM approach can have on your organization.

To summarize the top five tips for getting the most out of your workforce performance
management system:

1. Calibrate Performance Ratings Across The Organization

2. Link Performance Processes to Career Development And Learning Management
3. Enable Pay-For-Performance To Build A Merit-Based Culture
4. Drive Continuous Improvement By Leveraging Workforce Analytics
5. Configure, Don't Customize